Question
The stockholders equity section of Pillar Corporations comparative balance sheet at the end of 2013 and 2014 is presented below. It is part of the
The stockholders equity section of Pillar Corporations comparative balance sheet at the end of 2013 and 2014 is presented below. It is part of the financial data just reviewed at a stockholders meeting.
December 31, 2014 | December 31, 2013 | |
Common Stock, $10 Par Value, 600,000 shares | ||
authorized; issued at | ||
December 31, 2014, 275,000 shares; | ||
2013, 250,000 shares ..................... | $2,750,000 | 2,500,000 |
Paid-in Capital in Excess of Par............... | 4,575,000 | 4,125,000 |
Retained Earnings (see Note)................. | 2,960,000 | 2,825,000 |
Total Stockholders Equity ................... | $10,285,000 | $9,450,000 |
Note: Availability of retained earnings for cash dividends is restricted by $2,000,000 due to a planned plant expansion.
The following items were also disclosed at the stockholders meeting: net income for 2014 was $1,220,000; a 10% stock dividend was issued December 14, 2014; when the stock dividend was declared, the market value was $28 per share; the market value per share at December 31, 2014, was $26; management plans to borrow $500,000 to help finance a new plant addition, which is expected to cost a total of $2,300,000; and the customary $1.54 per share cash dividend had been revised to $1.40 when declared and issued the last week of December 2014. As part of its investor relations program, during the stockholders meeting management asked stockholders to write any questions they might have concerning the firms operations or finances. As assistant controller, you are given the stockholders questions.
I owned 7,500 shares of Pillar in 2013 and have not sold any shares. How much more or less of the corporation do I own at December 31, 2014, and what happened to the market value of my interest in the company?
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